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* Posts by Patrick Byrne

16 posts • joined 14 Dec 2007

Patrick Byrne: 'See, I told you America's economy was busted'

Patrick Byrne

You stuttered a bit there JB

"But just because the 'man on the street' doesn't grasp the nuances of securities analysis and management doesn't mean there's anything with our laws or our markets."

Haha. Still selling that old bromide? But you seem to have choked on the word "wrong". It looks like you were trying to say:

"But just because the 'man on the street' doesn't grasp the nuances of securities analysis and management doesn't mean there's anything WRONG with our laws or our markets."

But it seems you choked on getting out the word "wrong". Just where a speaker would, if he were stuttering on a lie.

How odd.

Patrick Byrne

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Patrick Byrne

You Minions of Sith need a new script.

Overstock has become a $1.1 billion pureplay Internet company, with Net Income of $8 million in 2009, and $14 million in 2010. 2011 is not over, of course, but our last stated results showed a $35 million trailing twelve month operating cash flow.

To the outsiders reading this: These Chewbacca Defense towel boys show up whenever the wig starts to slip, and the market gets revealed for what it is: a game rigged by a network of dirty hedge funds and a small number of the prime brokers who enable them.

Let that answer stand for all the objections below, mutatis mutandis, of course.

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Patrick Byrne

Vlad hits his mark

Actually, Vlad, there is this thing called "data", which shows that people actually do.... precisely what I have for 6 years been saying they do. Does not matter how much personal invective you fling, it does not change that data.

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Patrick Byrne

Once again, the Register beats the rest of the press. Oh, but they're British, right?

Cade Metz is being too hard on himself to write, "His methods are eccentric, and most of the press, including The Register, failed to see past those eccentricities."

The truth is, over the years, the Reg did listen to us, and while they may not have jumped in feet first, they definitely stirred things up, first by refusing to take part in the cover-up, and then in actually writing stories on aspects of this Crusade that few other US journalists would touch, no matter how much proof was held in their face (Matt Taibbi being another rare exception). For example, the assertion that Wikipedia was being used as an instrument of mass mind control, in that the page on naked short selling had been hijacked and followed a set of rules different from the other millions of pages on Wikipedia, was a fact that a dozen journalists had explained to them and tested for themselves, but were incapable of groking enough to really write anything on it. See it and related stories below.

The Reg is a real rarity: a place with thoughtful journalists, and not just schlubbs typing up press releases in their own words.

Take it from someone who knows,

Patrick Byrne

http://www.theregister.co.uk/2007/12/06/wikipedia_and_overstock/

Overstock's Byrne claims $5m scalp over short selling (9 December 2009)

Wikisupremes eject UK Wikispokesman from inner circle (2 December 2009)

Byrne's naked shorting crusade outs Yahoo! security vuln (8 September 2009)

Colbert salutes El Reg (5 June 2009)

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Overstock's Byrne claims $5m scalp over short selling

Patrick Byrne
Thumb Up

Once Again, The Reg Gets There First

Perhaps you are right, Anonymous, that in the early days "the El Reg tone was definitely a bit 'jaundiced'" about me. But I give them major props. They were willing to listen skeptically, which is all we wanted.

The Register, especially Cade Metz (and even that Ashlee Vance character) were the first journalists, ultimately, who were able to work through the Chewbacca Defense. Before The Register came along, one aspect or another of this story had been presented to a couple dozen journalists, each one of whom let the flashing "Minding Closing Now" neon light block their view of the "This story hangs together so I better check the evidence" sign. So congrats to The Register. I'm glad that they started off as skeptics. At least they started off.

No kidding, for what it's worth, having dealt (somewhat notoriously) with my share of reporters, El Reg's are among the few journos who give me hope for the profession. Even though they sometimes write crappy things about me.

Patrick Byrne

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Emails show journalist rigged Wikipedia's naked shorts

Patrick Byrne
Thumb Up

Now that we have your attention....

First, El Reg owes me no apology. In particular, as someone said above, this "actually has me thinking that The Register is a world-class journalistic publication." Cade deserves great credit. The fact that he took some time to connect these dots does not matter: the fact is, there are a dozen journalists who knew at least some of the dots, and none could see the picture emerge other than Cade. It matters little to me that as he did so, he kept a foot, and then a toe, in the camp of conventional thought: in the end, he was the guy who stepped out of it first. The tongue-in-cheek stuff of earlier El Reg articles were a small price to pay.

Second, in response to the people saying things like, "So I guess the Russian Mafia aren't involved anymore?" I respond, that's is just more non sequitur. There is nothing in here that says OC is not involved. In fact, here is a Forbes story from 20 months ago that El Reg readers should take a look at, and then see what dots they can connect for themselves:

http://www.forbes.com/home/free_forbes/2007/0212/064.html (Understand that the way PIPEs are gamed is through naked short selling, though Vardi treads lightly on explaining why.)

Third, if you want to get the true Big Picture, and understand how this all relates to today's headlines, and enter a $75,000 contest where the readers decide who wins the prizes, read

http://www.deepcapture.com/the-story-of-deep-capture-by-mark-mitchell/ . Warning: PG-13, and it is 69 pages of Thomas Pynchon meets John Grisham, and is a hell of a dense story to make sense of.

Four and finally, after three years of trying to get people to see the implications of what is going on, Iamzippy's quote made my day: "There's shit, and then there's heavy-duty shit. This article is awesome, and we've not heard the last." You got it. You got it. You got it.

Selah,

Patrick Byrne

patrick@overstock.com

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Wikimadness XVII: The Return of Byrne

Patrick Byrne

It's always something, Coward

How would the Marine's cancelling orders explain why FRPT shares have been sold and not delivered for 300 days?

Coward's post illustrates the routine perfectly. Crooks naked short a company, then fill social media with innuendo about "possible accounting issues...", see a small group of compliant financial journalists repeat the innuendo, and hope the public is suggestible enough not to notice that the innuendo really has nothing to with the issue that someone is selling non-existent shares that never deliver.

FRPT's economics are soaring. However, that is not relevant to the analysis, so it would not matter even if they were not. The analysis is: Someone is selling non-existent shares of FRPT, not delivering anything, but taking people's money for it. In fact, this is happening in hundreds of companies. For years, anyone trying to question this was drowned out by claims that "Maybe this company has an accounting issue," "Maybe this company's drug is not going to work as well as people hope," "Maybe the orders are going to drop off," etc. Just blue-smoke-and-mirrors.

If you want to read how this is all being organized, read DeepCapture.com .

Patrick

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Patrick Byrne

Force Protection

Force Protection makes MRAP's for our soldiers. 300 IED attacks, no fatalities (except one roll-over where a guy hanging out the machine gun portal was crushed).

In the last 4 quarters FRPT has made Net Income (GAAP) of $40 million on $500 million in sales. The DOD has ordered 12,000 of them. FRPT cannot keep up with production. So, with their stock at $25, they announced a secondary to raise capital to expand their factory. They were immediately naked shorted down to $4 (in fact, I think they have been on the Reg SHO list for about a year now).

Because they were naked shorted down to $4, they cancelled their offering. Because they cancelled their offering, they did not raise capital to expand their factory. Because they did not expand their factory, fewer MRAP's are being shipped to Iraq and Afghanistan. Because of that, some soldiers will die in Iraq this month, just so some hedge fund ass-clown in Stamford, Connecticut can drive a Porsche.

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Patrick Byrne

Comment on article by Patrick Byrne

Hi. This is mostly accurate. Far more accurate than the tripe which passes for journalism in our financial media, in any case. Just one thing with which I would take issue. Mr. Metz writes:

"But Byrne is still peeved. Much like the Wall Street press, a group of Wikipedia insiders - including cult leader Wales - spent years battling the Overstock chief over the naked shorting issue, and Byrne has long claimed that these anonymous encyclopedia obsessives conspired with a well-known financial journalist to ruin his company and his reputation. Well, now he want wants a mea culpa. And Wikipedia has yet to oblige."

Once again, this trivializes the issue by reducing it to some kind of personal beef. The truth is, this fight is not about me being "peeved" or some guys trying to ruin my reputation or me wanting "a mea culpa". What this is about is as follows: there is a crime going on. It is destroying the US capital markets and, as is now obvious, creating a risk of systemic collapse (which is why the feds passed this Emergency Order to wall off our banking sector from the very problem that a few years ago they were denying exists). I am trying to expose these criminals. Because Gary Weiss has hijacked these pages on Wikipedia, and the Wiki-elite are covering him, it means that the Wikipedia page has been used in a cover-up. The cover-up has reached absurd proportions, where the Wikipedia page reports as fact claims that have been blown out of the water by the events of the last few months. (See the talk page for numerous examples.)

To all who have deep concerns about Wikipedia, you will never find an example like this: Wikipedia has successfully been used as an instrument of mass mind-control and cover-up. Read the NSS page and the Talk page at Wikipedia to see what I mean.

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Overstock CEO offers $75,000 for Wall Street's soul

Patrick Byrne

One Answer

"If I pay a grocer a dollar for an apple. If the grocer doesn't provide said apple the grocer will be prosecuted.

"If I pay a stockbroker for a share in an apple, if the stockbroker doesn't deliver said share... nothing happens to the stockbroker?

"How is naked short selling different from fraud? What am I missing?"

The answer is, you are missing nothing at all. you have it exactly right. Some lawyers in some backrooms ahve dressed it up with a lot of fancy terminology, but "FTDs" ("Failures to Deliver") when done purposefully, are absolutely fraud. But as a crime it is beautiful because your broker keeps sending your sttements saying that you ahve those shares. What he does not tell you is that, for every share your broker is holding, he may be telling 5 people the same thing.

Patrick

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Patrick Byrne

One correction

To win, we are not looking for a "publicity stunt" necessarily.

I wrote one blog at DeepCapture ("So You Say You Want a Revolution?") full of pretty vanilla suggestions, and links to make it easy to write newspaper editors, Congressional delegations, FINRA and SIFMA etc.

Of course, PR stunts may work too.

The community selects the winners.

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Wikipedia kills Greatest Show On Earth

Patrick Byrne
Stop

Pubspeak is closest to the truth

Folks are nuts if they think this does not affect them. It affects every person reading this. The connection between this story, and your retirement, is deep. But it is huge.

Read the link in the story to DeepCapture.com .

Patrick

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A Shaolin monk, Warren Buffett and a Russian mobster walk into a bar…

Patrick Byrne
Happy

responses from patrick

All,

Thanks for your kind words. Glad it was of itnerest. I agree with the commenter who said he thought the sound quality was fine, but I am not an audiophile like so many other listeners apparently are.

On the "wriggler" front: I think I made that slang up. Not sure. Seems to fit. And the point was not so much to defend their choice of lifestyle (I'm a libertarian, and pretty agnostic about such matters), as to refuse to buy in to the fact that our society denigrates the one but lionizes the Wall Street thief who steals billions. I wanted to defend Stormy without buying into that denigration. That was the best way I could put it.

Congrats to Ashlee on being among the first to get what is going on.

Patrick

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Patrick Byrne

Ashlee Vance Is A Classy Guy

All blame for the misunderstanding rests with me. Ashlee's immediate correction of this point shows immense integrity. Now if only I could get him that iPod order we screwed up three years ago!

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Patrick Byrne

Ashlee is Flat Wrong About Stormy

[This story previously characterized Overstock as employing a "former exotic dancer" as an executive. That was a mistake. Patrick submitted the following comment about Overstock Exec Stormy Simon - aka Overstock's Erin Brokovich.]

Some years ago my friend and colleague, Stormy Simon, put a killer (David Meade) behind bars. For four years the police searched for a witness of whom they knew only a name, “Stormy” (which they mistakenly assumed to be a stripper’s nom du stage: they thus confined their searches to Intermountain strip joints). They never found Stormy, and while Stormy knew some key facts about the murder, she did not know that a murder had taken place (yes, that really happened). Stormy learned only when Meade found her to tell her that if she testified she “would end up face down in a field with a bullet in her head.” At the end of Meade’s trial it seemed certain he would walk out of court a free man, but in a John Grisham-like twist, Stormy surprised everyone by showing up in the courtroom. Her testimony put Meade away for life. She is a hero to the Salt Lake City homicide detectives and prosecutors, one of whom just wrote a book, “Death in a Fish Pond,” the climax of which is Stormy’s out-of-the-blue heroism (the only other witness, incidentally, has since ended up face down in a field).

The shorts have made legend out of this “ex-stripper executive” story, even though the crux of the story is that it was the police’s mistaken assumption about her name that caused them to miss her in the first place. They know it to be false, yet slimily, they continuously feed it to compliant reporters who dutifully bring it up, often in these “Without any reference to this person’s non-existent illicit past” ways. (For the record, I count several wrigglers and escorts among my friends, consider these women finer human beings than the average denizen of Wall Street, and would have no objection to hiring any of them, but unfortunately, they are all holding out for C-level titles.)

This introduction contains a grievous error about a wonderful woman.

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Wikipedia COO was convicted felon

Patrick Byrne

"open, free, and 99% reliable" if you own one

Ani,

If you think it is open, try posting this article there and see how long the record of your thought-crime persists:

http://www.theregister.co.uk/2007/12/06/wikipedia_and_overstock/

Best,

Patrick M. Byrne

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